Inflation targeting has been hailed as the most robust monetary policy formulation strategy to have positively impacted central banks, including the Bank of Ghana.
This statement was made by Dr. Maxwell Opoku-Afari, First Deputy Governor-Bank of Ghana, during his address at the ‘Central Banking in Ghana and the Governors (Institutional Growth and Economic Development)’ book launch.
Dr. Opoku-Afari emphasised the significance of inflation-targetting as a monetary policy framework, highlighting its positive influence on central banks’ objectives – particularly the Bank of Ghana. The adoption of inflation-targetting by the Bank of Ghana in 2007, coupled with a flexible exchange rate regime, aimed to maintain price stability; a vital requirement for sustainable economic growth and development.
Under the inflation-targetting framework, the Bank of Ghana set an inflation target of 8 percent with a symmetric band of 2 percent, allowing for a range of 6 to 10 percent. However, due to the unprecedented effects of the COVID-19 pandemic and external factors, Ghana’s inflation rate soared to a peak of 52.8 percent in March 2023… well beyond the Bank’s target. As of May 2023 the inflation rate remained elevated at 42.2 percent, raising concerns about the inflation-targetting regime’s effectiveness.
In conjunction with the book launch, the author – Mr. Ivor Agyeman-Duah – shed light on the central banking landscape in Ghana, focusing on the roles played by successive Governors in achieving the Bank’s objectives and fostering economic development in the country. The Bank of Ghana has expressed its support for the publication, acknowledging its contribution to the literature on central banking in Ghana; particularly in the areas of monetary policy, regulation and supervision.
Mr. Agyeman-Duah’s book fills a significant void in existing publications about the Bank of Ghana, providing insights into individual governors and the economic philosophies that underpinned their monetary policy decisions. The book aims to enhance public understanding of the central bank’s operations, including the often-debated concept of institutional operational independence and accountability.
While the book offers a comprehensive overview of the Bank of Ghana’s Governors since its inception, it acknowledges that readers’ interpretations of the Governors’ work may vary depending on their economic philosophies or ideologies. The author welcomes constructive critique and commentary from economists, academics and reviewers, ensuring an open and intellectual public discourse on the book’s content and assertions.
The book is not only a valuable resource for central bankers, but also for academics and economics students both in Ghana and beyond. It provides an in-depth exploration of central banking in Ghana, shedding light on the Governors’ contributions to institutional growth and economic development.
The First Deputy Governor, highly recommends ‘Central Banking in Ghana and the Governors (Institutional Growth and Economic Development)’ to all interested individuals. The book’s launch serves as an opportunity to delve into the world of central banking, fostering a deeper understanding of monetary policy and its impact on Ghana’s economy.
